Description
New York Mercantile Exchange (NYMEX) is a commodity futures exchange owned and operated by CME Group of Chicago. NYMEX is located at One North End Avenue in Brookfield Place in the Battery Park City section of Manhattan, New York City.
The company's two principal divisions are the New York Mercantile Exchange and Commodity Exchange, Inc (COMEX), once separately owned exchanges. NYMEX traces its history to 1882 and for most of its history, as was common of exchanges, it was owned by the members who traded there. Later, NYMEX Holdings, Inc., the former parent company of the New York Mercantile Exchange and COMEX, went public and became listed on the New York Stock Exchange on November 17, 2006, under the ticker symbol NMX. On March 17, 2008, Chicago based CME Group signed a definitive agreement to acquire NYMEX Holdings, Inc. for $11.2 billion in cash and stock and the takeover was completed in August 2008. Both NYMEX and COMEX now operate as designated contract markets (DCM) of the CME Group. The other two designated contract markets in the CME Group are the Chicago Mercantile Exchange and the Chicago Board of Trade.
The New York Mercantile Exchange handles billions of dollars' worth of oil transactions, energy carriers, metals, and other commodities being bought and sold on the trading floor and the overnight electronic trading computer systems for future delivery. The prices quoted for transactions on the exchange are the basis for prices that people pay for various commodities throughout the world.
The floor of the NYMEX is regulated by the Commodity Futures Trading Commission, an independent agency of the United States government. Each individual company that trades on the exchange must send its own independent brokers. Therefore, a few employees on the floor of the exchange represent a big corporation and the exchange employees only record the transactions and have nothing to do with the actual trade.
Although mostly electronic since 2006, the NYMEX maintained a small venue, or "pit", that still practiced the open outcry trading system, in which traders employed shouting and complex hand gestures on the physical trading floor. A project to preserve the hand signals used at NYMEX has been published. NYMEX closed the pit permanently at the end of trading Friday, December 30, 2016, because of shrinking volume.
